U.S.-Israel relations in crisis mode as tensions boil over

• The rare U.S. rebuke of one of its closest allies came after weeks of bubbling tensions between the two countries.

How we got here: Biden administration officials told Axios they knew a crisis with the Israeli government was going to happen at some point, but they tried to postpone it as much as possible.

• The administration had expressed concerns even before Netanyahu was sworn in, including over the ministerial posts the prime minister was set to give to certain far-right coalition partners. But at the time, U.S. officials say, the Biden administration wanted to avoid confrontation so it could directly work with Netanyahu on countering Iran and expanding the Abraham Accords.
• Netanyahu also sought to reassure international concerns about his government, telling U.S. news outlets that he "will have his hands on the wheel" and not his far-right extremist coalition partners.

Still, tensions began to bubble just weeks after the Israeli government was sworn in when the ruling coalition presented its plan to weaken the Supreme Court and other democratic institutions. U.S. officials, including President Biden, expressed concerns over what the plan would mean for Israel's democracy.

• Tensions also bubbled over several incidents in the occupied West Bank, including Israeli Finance Minister Bezalel Smotrich's call to "wipe out" the Palestinian village of Hawara — a call he has since tried to walk back.
• The comment led the White House to publicly announce that the Biden administration would boycott Smotrich during his visit to Washington. The State Department considered not issuing a visa.
• Tensions continued to surface when the White House again condemned Smotrich — this time for his claim that the Palestinian people were “an invention” and don't exist.

Then, on Tuesday, those tensions boiled over when the Israeli Knesset repealed the 2005 disengagement law. The move allows Israeli citizens to enter the area between the cities of Jenin and Nablus, which Israeli settlers had evacuated in 2005.

• The move could dramatically increase the potential for friction between settlers and Palestinians in the most sensitive and volatile area of the occupied West Bank.
• The U.S. called the move a "provocation" and a violation of commitments given to the U.S. by the Israeli government.

Behind the scenes: Herzog was summoned on short notice for a meeting with Deputy Secretary of State Wendy Sherman, two Israeli and U.S. sources said.

• The last time an Israeli ambassador was summoned to the State Department was in 2010 when Israel approved a new building in an East Jerusalem settlement during then-Vice President Biden's visit to the country.

• Sherman and Herzog's meeting was very tough, with Sherman saying the new law is a violation of the commitment the Israeli government made to the U.S., Egypt and Jordan just last Sunday during the summit in Sharm el-Sheikh, a source with knowledge of the meeting said. That commitment included avoiding steps that could escalate the situation in the West Bank.

What they're saying: The summoning of Herzog was "a result of the Israelis going too far — the judicial overhaul, Smotrich and now this law — it was just too much," a U.S. official told Axios.

• An Israeli official claimed the summoning wasn't a sign of a crisis but just a way for the State Department to reiterate its concerns

Netanyahu on Wednesday pushed back on the Biden administration’s criticism, saying the new law “brings an end to a discriminatory and humiliating law that barred Jews from living in areas in northern Samaria, part of our historic homeland."

• At the same time, the Prime Minister’s Office stressed that the government has no intention of establishing new settlements in the parts of the West Bank the new law addresses.

What to watch: Netanyahu is a veteran of dealing with tensions and crises with a Democratic president after eight years of working with the Obama administration.

• Some of his aides recently started using a phrase reminiscent of the Obama-era days. “Let's talk again in 2024," one aide told Axios, hinting at the next U.S. presidential election.